SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934*
Silicon Graphics, Inc.
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(Name of Issuer)
Common Stock, par value $0.01 per share
--------------------------------------------------------------------------------
(Title of Class of Securities)
827056300
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(CUSIP Number of Class of Securities)
Robert Burns, Esq.
Quadrangle Group LLC
375 Park Avenue
New York, NY 10152
(212) 418-1700
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
Copies to:
Michael A. Schwartz, Esq.
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, NY 10019-6099
(212) 728-8000
October 17, 2006
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(Date of Event which Requires
Filing of this Schedule)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box: [ ]
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 240.13d-7 for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
-------------------------------------- ------------------------------
CUSIP No. 827056300 Page 2 of 20 Pages
-------------------------------------- ------------------------------
----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Quadrangle Debt Recovery Advisors LLC
----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
----------- --------------------------------------------------------------------
3 SEC USE ONLY
----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
--------------------- --------- ------------------------------------------------
7 SOLE VOTING POWER
0
--------- ------------------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 3,097,140
PERSON WITH --------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,097,140
----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
3,097,140
----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
27.8%
----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
----------- --------------------------------------------------------------------
SCHEDULE 13D
-------------------------------------- ------------------------------
CUSIP No. 827056300 Page 3 of 20 Pages
-------------------------------------- ------------------------------
----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
QDRF Master Ltd.
----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
----------- --------------------------------------------------------------------
3 SEC USE ONLY
----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Cayman Islands
--------------------- --------- ------------------------------------------------
7 SOLE VOTING POWER
0
--------- ------------------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 2,088,166
PERSON WITH --------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
2,088,166
----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
2,088,166
----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
18.8%
----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
----------- --------------------------------------------------------------------
SCHEDULE 13D
-------------------------------------- ------------------------------
CUSIP No. 827056300 Page 4 of 20 Pages
-------------------------------------- ------------------------------
----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Quadrangle Debt Opportunities Master Ltd.
----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
----------- --------------------------------------------------------------------
3 SEC USE ONLY
----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Cayman Islands
--------------------- --------- ------------------------------------------------
7 SOLE VOTING POWER
0
--------- ------------------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 658,557
PERSON WITH --------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
658,557
----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
658,557
----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.9%
----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
----------- --------------------------------------------------------------------
SCHEDULE 13D
-------------------------------------- ------------------------------
CUSIP No. 827056300 Page 5 of 20 Pages
-------------------------------------- ------------------------------
----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Michael Weinstock
----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
----------- --------------------------------------------------------------------
3 SEC USE ONLY
----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
--------------------- --------- ------------------------------------------------
7 SOLE VOTING POWER
0
--------- ------------------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 3,097,140
PERSON WITH --------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,097,140
----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
3,097,140
----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
27.8%
----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
----------- --------------------------------------------------------------------
SCHEDULE 13D
-------------------------------------- ------------------------------
CUSIP No. 827056300 Page 6 of 20 Pages
-------------------------------------- ------------------------------
----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Andrew Herenstein
----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
----------- --------------------------------------------------------------------
3 SEC USE ONLY
----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
--------------------- --------- ------------------------------------------------
7 SOLE VOTING POWER
0
--------- ------------------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 3,097,140
PERSON WITH --------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,097,140
----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
3,097,140
----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
27.8%
----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
----------- --------------------------------------------------------------------
SCHEDULE 13D
-------------------------------------- ------------------------------
CUSIP No. 827056300 Page 7 of 20 Pages
-------------------------------------- ------------------------------
----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Christopher Santana
----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
----------- --------------------------------------------------------------------
3 SEC USE ONLY
----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
--------------------- --------- ------------------------------------------------
7 SOLE VOTING POWER
0
--------- ------------------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 3,097,140
PERSON WITH --------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,097,140
----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
3,097,140
----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
27.8%
----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
----------- --------------------------------------------------------------------
SCHEDULE 13D
-------------------------------------- ------------------------------
CUSIP No. 827056300 Page 8 of 20 Pages
-------------------------------------- ------------------------------
----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Josiah Rotenberg
----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
----------- --------------------------------------------------------------------
3 SEC USE ONLY
----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States, Canada and Israel
--------------------- --------- ------------------------------------------------
7 SOLE VOTING POWER
0
--------- ------------------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 3,097,140
PERSON WITH --------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,097,140
----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
3,097,140
----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
27.8%
----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
----------- --------------------------------------------------------------------
This Schedule 13D relates to the common stock, par value $0.01 per share
(the "Common Stock"), of Silicon Graphics, Inc., a Delaware corporation (the
"Company"). This Schedule 13D is being filed on behalf of Quadrangle Debt
Recovery Advisors LLC, a Delaware limited liability company ("Advisors"), QDRF
Master Ltd, a Cayman Islands company ("QDRF"), Quadrangle Debt Opportunities
Fund Master Ltd., a Cayman Islands company ("QDOFM"), Michael Weinstock, a
managing member of Advisors ("Mr. Weinstock"), Andrew Herenstein, a managing
member of Advisors ("Mr. Herenstein"), Christopher Santana, a managing member of
Advisors ("Mr. Santana") and Josiah Rotenberg, a managing member of Advisors
("Mr. Rotenberg" and, together with Advisors, Mr. Weinstock, Mr. Herenstein and
Mr. Santana, the "Controlling Reporting Persons", and together with QDRF and
QDOFM, the "Reporting Persons"). Advisors is the investment advisor to a variety
of hedge funds (such funds, collectively, including but not limited to QDRF and
QDOFM, the "Funds"). The Funds directly own the Common Stock to which this
Schedule 13D relates, and Advisors, Mr. Weinstock, Mr. Herenstein, Mr. Santana
and Mr. Rotenberg may be deemed to have beneficial ownership over such Common
Stock by virtue of the authority granted to them by the Funds to vote and to
dispose of the securities held by the Funds, including the Common Stock.
Item 1. Security and Issuer.
This statement on Schedule 13D relates to the Common Stock of the Company
and is being filed pursuant to Rule 13d-1 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The address of the principal executive
offices of the Company is 1200 Crittenden Lane, Mountain View, California 94043.
Information given in response to each item shall be deemed incorporated by
reference in all other items, as applicable.
Item 2. Identity and Background.
(a) This statement is being filed by the Reporting Persons. Mr. Weinstock,
Mr. Herenstein, Mr. Santana and Mr. Rotenberg are each a managing member of
Advisors. Advisors is organized as a limited liability company under the laws of
the State of Delaware. QDRF and QDOFM are organized under the laws of the Cayman
Islands.
(b) The address of the principal business and principal office of Advisors,
Mr. Weinstock, Mr. Herenstein, Mr. Santana and Mr. Rotenberg is 375 Park Avenue,
14th Floor, New York, New York 10152. The address of the principal business and
principal office of QDRF and QDOFM is Walker House, P.O. Box 908GT, Georgetown,
Grand Cayman, Cayman Islands, British West Indies.
9
(c) The principal business of Advisors is to serve as investment advisor to
the Funds and to control the investing and trading in securities of the Funds.
The principal business of each of Mr. Weinstock, Mr. Herenstein, Mr. Santana and
Mr. Rotenberg is to act as a managing member of Advisors. The principal business
of QDRF and QDOFM is to invest and trade in securities.
(d) None of the Reporting Persons, nor, to the best of their knowledge, any
of their directors, executive officers, general partners or members has, during
the last five years, been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) None of the Reporting Persons, nor, to the best of their knowledge, any
of their directors, executive officers, general partners or members has, during
the last five years, been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
(f) Mr. Weinstock, Mr. Herenstein, Mr. Santana and Mr. Rotenberg are United
States citizens. Mr. Rotenberg is also a citizen of Canada and Israel.
Item 3. Source and Amount of Funds or Other Consideration.
The Reporting Persons acquired the shares of Common Stock beneficially
owned by them as part of the reorganization of the Company under chapter 11 of
the federal bankruptcy code (the "Reorganization") pursuant to the First Amended
Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy Code, as
Modified, dated July 27, 2006 (together with any agreements entered into in
connection therewith, the "Plan"). On October 17, 2006 (the "Effective Date"),
the Plan became effective under chapter 11 of the federal bankruptcy code.
As part of the Reorganization, the 6.50% Senior Secured Convertible Notes
Due 2009 (the "Convertible Notes") of the Company were converted into Common
Stock. Accordingly, Convertible Notes indirectly beneficially owned by the
Controlling Reporting Persons in the aggregate principal amount of $50,989,000
were converted into 667,335 shares of Common Stock; Convertible Notes held
directly by QDRF in the aggregate principal amount of $34,378,000 were converted
into 449,933 shares of Common Stock; and Convertible Notes held directly by
QDOFM in the aggregate principal amount of $10,842,000 were converted into
141,898 shares of Common Stock.
10
The Funds expended an aggregate of approximately $16,206,793 of their own
investment capital to purchase 1,815,152 shares of Common Stock as part of a
rights offering in connection with the Reorganization (the "Rights Offering")
and 614,652 shares pursuant to a Backstop Commitment Agreement executed in
connection with the Rights Offering.
QDRF expended an aggregate of approximately $10,927,007 of its own
investment capital to purchase 1,223,819 shares of Common Stock as part of the
Rights Offering and 414,413 shares pursuant to a Backstop Commitment Agreement
executed in connection with the Rights Offering.
QDOFM expended an aggregate of approximately $3,446,115 of its own
investment capital to purchase 385,963 shares of Common Stock as part of the
Rights Offering and 130,696 shares pursuant to a Backstop Commitment Agreement
executed in connection with the Rights Offering.
Prior to the Reorganization, the Funds held Convertible Notes that were
convertible into more than 5% of the common stock, par value $0.001 per share
(the "Old Common Stock") of the Company, and Advisors, QDRF, Mr. Weinstock, Mr.
Herenstein, Mr. Santana and Mr. Rotenberg (the "Old Common Stock Reporting
Persons") beneficially owned such Old Common Stock solely through the direct
ownership of the Convertible Notes by the Funds. The Funds had expended an
aggregate of approximately $38,743,170 of their own investment capital to
acquire the Convertible Notes held by them as of the Effective Date, which were
at that time convertible into 40,791,200 shares of Old Common Stock. QDRF had
expended an aggregate of approximately $24,668,540 of its own investment capital
to acquire its Convertible Notes held as of the Effective Date, convertible into
27,502,400 shares of Old Common Stock at that time.
Item 4. Purpose of Transaction.
The Funds acquired the shares of Common Stock in connection with the
Reorganization of the Company, in accordance with the Plan. The Reporting
Persons may cause the Funds to make further acquisitions of Common Stock from
time to time or to dispose of any or all of the shares of Common Stock held by
the Funds at any time.
Pursuant to the Plan, an employee of Advisors became a member of the Board
of Directors of the Company, as of the Effective Date (as defined below).
Except as set forth above, the Reporting Persons do not have any present
plans or proposals that relate to or would result in any of the actions required
to be described in Item 4 of Schedule 13D. Each of the Reporting Persons may, at
any time,
11
review or reconsider its position with respect to the Company and formulate
plans or proposals with respect to any of such matters.
The Funds initially acquired their Convertible Notes for passive
investment. The Reporting Persons intended to cause the Funds to make further
acquisitions of Convertible Notes from time to time or to dispose of any or all
of the Convertible Notes held by the Funds at any time. In March 2006, the Funds
joined the Ad Hoc Committee of 6.50% Senior Secured Convertible Noteholders,
which participated in the discussions and negotiations with the Company that
ultimately resulted in the filing of a consensual plan of reorganization under
chapter 11 of the federal bankruptcy code. In April 2006, the Reporting Persons
caused the Funds to acquire additional Convertible Notes with the intention of
establishing a position that would enable them to play an active role in a
potential reorganization or restructuring of the Company.
Item 5. Interest in Securities of the Issuer.
The Company issued an aggregate of 11,125,000 shares of Common Stock in
connection with the Plan. All references to the Company's total outstanding
Common Stock are to the 11,125,000 shares of Common Stock outstanding as of
October 19, 2006, as represented in the Form 8-A filed by the Company on October
20, 2006.
(a) and (b)
As of the date of this Schedule 13D, QDRF is the beneficial owner of
2,088,166 shares of Common Stock, or approximately 18.8% of the Company's total
outstanding Common Stock. The Controlling Reporting Persons and QDRF share
voting power and dispositive power over the 2,088,166 shares of Common Stock
held directly by QDRF.
As of the date of this Schedule 13D, QDOFM is the beneficial owner of
658,557 shares of Common Stock, or approximately 5.9% of the Company's total
outstanding Common Stock. The Controlling Reporting Persons and QDOFM share
voting power and dispositive power over the 658,557 shares of Common Stock held
directly by QDOFM.
As of the date of this Schedule 13D, the Controlling Reporting Persons may
be deemed to be the beneficial owner of 3,097,140 shares of Common Stock, or
approximately 27.8% of the Company's total outstanding Common Stock, indirectly
as a result of their relationship with the Funds (including QDRF and QDOFM). The
Controlling Reporting Persons share voting and dispositive power over the
3,097,140 shares of Common Stock held directly by the Funds. QDRF and QDOFM
disclaim beneficial ownership of such shares of Common Stock except to the
extent of their pecuniary interest therein.
12
On the Effective Date, each of the Reporting Persons ceased to beneficially
own the Old Common Stock that had been issuable upon conversion of the
Convertible Notes.
The beneficial ownership of Old Common Stock by the Old Common Stock
Reporting Persons as of November 7, 2005, was as follows:
QDRF was the beneficial owner of 8,905,600 shares of Old Common Stock then
issuable upon conversion of the Convertible Notes held by it, or approximately
3.2% of the Company's total outstanding Old Common Stock. The Controlling
Reporting Persons may be deemed to have beneficially owned an aggregate of
14,628,000 shares of Old Common Stock then issuable upon conversion of the
Convertible Notes held by the Funds, or approximately 5.2% of the Company's
total outstanding Old Common Stock, indirectly as a result of their control
relationship with the Funds (including, but not limited to, QDRF). The
Controlling Reporting Persons shared voting and dispositive power over the
shares of Old Common Stock then issuable upon conversion of the Convertible
Notes held directly by the Funds. QDRF disclaims beneficial ownership of such
shares of Old Common Stock except to the extent of their pecuniary interest
therein. The Controlling Reporting Persons and QDRF shared voting power and
dispositive power over the shares of Old Common Stock then issuable upon
conversion of the Convertible Notes held by QDRF.
All references to the Company's total outstanding Old Common Stock in the
immediately preceding paragraph are calculated as the sum of (i) the 268,402,188
shares of Old Common Stock issued and outstanding as of October 28, 2005, as
reported in the Company's Quarterly Report on Form 10-Q for the quarterly period
ending September 30, 2005, and (ii) the number of shares of Old Common Stock
that had been issuable upon conversion of the Convertible Notes held by QDRF or
the Controlling Reporting Persons, as applicable.
The beneficial ownership of Old Common Stock by the Old Common Stock
Reporting Persons as of April 6, 2006, was as follows:
QDRF was the beneficial owner of 27,502,400 shares of Old Common Stock then
issuable upon conversion of the Convertible Notes held by it, or approximately
9.3% of the Company's total outstanding Old Common Stock on an as-converted
basis. The Controlling Reporting Persons may be deemed to have beneficially
owned an aggregate of 40,791,000 shares of Old Common Stock then issuable upon
conversion of the Convertible Notes held by the Funds, or approximately 13.2% of
the Company's total outstanding Old Common Stock on an as-converted basis,
indirectly as a result of their control relationship with the Funds (including
QDRF). The Controlling Reporting Persons shared voting and dispositive power
over the shares of Old Common Stock then issuable upon
13
conversion of the Convertible Notes held directly by the Funds. QDRF disclaims
beneficial ownership of such shares of Old Common Stock except to the extent of
their pecuniary interest therein. The Controlling Reporting Persons and QDRF
shared voting power and dispositive power over the shares of Old Common Stock
then issuable upon conversion of the Convertible Notes held by QDRF.
All references to the Company's total outstanding Old Common Stock in the
immediately preceding paragraph are calculated as the sum of (i) the 268,402,188
shares of Old Common Stock issued and outstanding as of January 27, 2006, as
reported in the Company's Quarterly Report on Form 10-Q for the quarterly period
ending December 30, 2005, and (ii) the number of shares of Old Common Stock that
had been issuable upon conversion of the Convertible Notes held by QDRF or the
Controlling Reporting Persons, as applicable.
The beneficial ownership of Old Common Stock by the Old Common Stock
Reporting Persons immediately prior to the Effective Date was the same as on
April 6, 2006. However, as a result of an increase in the Company's total
outstanding Old Common Stock, the percentage ownership differs from that set
forth above, and immediately prior to the Effective Date was as follows:
QDRF was the beneficial owner of approximately 9.1% of the Company's total
outstanding Old Common Stock, on an as-converted basis. The Controlling
Reporting Persons may be deemed to have beneficially owned an aggregate of
approximately 12.9% of the Company's total outstanding Old Common Stock, on an
as-converted basis, indirectly as a result of their control relationship with
the Funds (including QDRF). The Controlling Reporting Persons shared voting and
dispositive power over the shares of Old Common Stock then issuable upon
conversion of the Convertible Notes held directly by the Funds. QDRF disclaims
beneficial ownership of such shares of Old Common Stock except to the extent of
their pecuniary interest therein. The Controlling Reporting Persons and QDRF
shared voting power and dispositive power over the shares of Old Common Stock
then issuable upon conversion of the Convertible Notes held by QDRF.
All references to the Company's total outstanding Old Common Stock in the
immediately preceding paragraph are calculated as the sum of (i) the 274,247,196
shares of Old Common Stock issued and outstanding as of September 15, 2006, as
reported in the Company's Quarterly Report on Form 10-Q for the quarterly period
ending March 31, 2006, and (ii) the number of shares of Old Common Stock that
had been issuable upon conversion of the Convertible Notes held by QDRF or the
Controlling Reporting Persons, as applicable.
(c) Except for transactions in connection with the Reorganization of the
Company, as described in this Schedule 13D, none of the Reporting Persons has
effected any transaction in the Common Stock in the past 60 days.
14
Schedule A hereto sets forth information with respect to transactions by
the Funds in Convertible Notes between August 31, 2005 and the Effective Date.
Schedule B hereto sets forth information with respect to transactions by
QDRF in Convertible Notes between August 31, 2005 and the Effective Date.
Except as set forth above and on Schedule A and Schedule B, between August
31, 2005 and the Effective Date there were no transactions in the Old Common
Stock or the Convertible Notes effected by the Old Common Stock Reporting
Persons.
(d) No person other than the Reporting Persons has the right to receive or
the power to direct the receipt of dividends from, or the proceeds from the sale
of the Common Stock to which this statement relates.
No person other than the Old Common Stock Reporting Persons had the right
to receive or the power to direct the receipt of dividends from, or the proceeds
from the sale of the Convertible Notes or Old Common Stock.
(e) Not applicable with respect to the Common Stock.
As described more fully above, on the Effective Date all of the Old Common
Stock and Convertible Notes were cancelled and therefore each of the Reporting
Persons ceased to be the beneficial owner of shares of Old Common Stock.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to Securities of the Issuer.
Under the Registration Rights Agreement among the Company, the Funds
(including QDRF and QDOFM) and certain other investors named therein (together
with the Funds, the "Investors"), dated October 17, 2006 (the "Registration
Rights Agreement"), the Company has granted to the parties certain demand and
piggyback registration rights with respect to the shares of Common Stock now
held, or hereinafter acquired, by the Investors (the "Registrable Common
Stock"). Each of the Funds qualifies as a Key Holder under the Registration
Rights Agreement. Under the Registration Rights Agreement, a Key Holder has the
right to require the Company to effect the registration of such shares of Common
Stock in certain circumstances and subject to certain thresholds set forth
therein. Each Key Holder may request a maximum of two (2) demand registrations.
In addition, the Company has agreed that, no later than ten days after the
Company becomes eligible to file a Registration Statement on Form S-3, the
Company must prepare and file a Registration Statement on Form S-3 relating to
the offering on a continuous or delayed basis pursuant to Rule 415 under the
Securities Act of 1933, as amended (the "Securities Act"), by the Key Holders of
the Registrable Common Stock, subject to certain
15
conditions and limitations described in the Registration Rights Agreement. In
the event that the Company proposes to register Common Stock for its own
account, it shall, upon written request, effect the registration of such
requesting Key Holder's shares of Registrable Common Stock, subject to certain
limitations set forth therein.
The Registration Rights Agreement, which is filed as Exhibit 99.1 hereto,
is incorporated by reference herein. Any description of the Registration Rights
Agreement is qualified in its entirety by reference thereto.
Pursuant to Rule 13d-1(k) promulgated under the Exchange Act, the Reporting
Persons have entered into a Joint Filing Agreement with respect to the joint
filing of this statement and any amendments hereto, a copy of which is filed as
Exhibit 99.2 hereto.
Except as set forth herein, there are no contracts, arrangements,
understandings or relationships among the persons named in Item 2 or between
such persons and any other person with respect to any securities of the Company.
Item 7. Material to be Filed as Exhibits.
99.1 Registration Rights Agreement, by and among the Company and certain
Investors named therein, dated October 17, 2006 (incorporated by reference
to Exhibit 10.1 to the Current Report on Form 8-K of Silicon Graphics, Inc.
filed with the Securities and Exchange Commission on October 20, 2006).
99.2 Joint Filing Agreement, dated as of October 27, 2006, by and between the
Reporting Persons.
16
SIGNATURES
After reasonable inquiry and to the best of our knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.
Dated: October 27, 2006
QUADRANGLE DEBT RECOVERY ADVISORS LLC
By: /s/ Michael Weinstock
-----------------------------------------
Name: Michael Weinstock
Title: Managing Member
QDRF MASTER LTD.
By: Quadrangle Debt Recovery Advisors LLC, its
investment advisor
By: /s/ Michael Weinstock
-----------------------------------------
Name: Michael Weinstock
Title: Managing Member
QUADRANGLE DEBT OPPORTUNITIES FUND MASTER LTD.
By: Quadrangle Debt Recovery Advisors LLC, its
investment advisor
By: /s/ Michael Weinstock
-----------------------------------------
Name: Michael Weinstock
Title: Managing Member
MICHAEL WEINSTOCK
/s/ Michael Weinstock
----------------------------------------------
Michael Weinstock
CHRISTOPHER SANTANA
/s/ Christopher Santana
----------------------------------------------
Christopher Santana
ANDREW HERENSTEIN
/s/ Andrew Herenstein
----------------------------------------------
Andrew Herenstein
JOSIAH ROTENBERG
By: /s/ Robert Burns
-----------------------------------------
Name: Robert Burns
Title: Attorney-in-Fact
[SIGNATURE PAGE TO SCHEDULE 13D
WITH RESPECT TO SILICON GRAPHICS, INC.]
Schedule A
(Transactions by the Funds in Convertible Notes
since August 31, 2005)
Date Transaction Aggretgate Face % Face Value %Ownership Following
---- ----------- --------------- ------------ --------------------
Value Price Per Note Transaction
----- -------------- -----------
08/31/05 BUY 1,050,000 75.75 0.3%
------------------- ---------------------- -------------------- ---------------- --------------------------------
09/12/05 BUY 1,550,000 76.50 0.5%
------------------- ---------------------- -------------------- ---------------- --------------------------------
09/15/05 BUY 2,050,000 78.00 0.6%
------------------- ---------------------- -------------------- ---------------- --------------------------------
10/19/05 BUY 3,826,000 78.50 1.1%
------------------- ---------------------- -------------------- ---------------- --------------------------------
10/27/05 BUY 6,826,000 79.75 2.0%
------------------- ---------------------- -------------------- ---------------- --------------------------------
10/28/05 BUY 10,826,000 80.00 3.1%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/02/05 BUY 11,326,000 70.00 3.3%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/02/05 BUY 12,025,000 71.50 3.5%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/02/05 BUY 13,525,000 72.00 3.9%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/03/05 BUY 15,475,000 72.50 4.4%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/04/05 BUY 33,950,000 72.75 4.95%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/07/05 BUY 18,285,000 72.75 5.2%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/09/05 BUY 19,285,000 72.75 5.4%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/10/05 BUY 19,985,000 72.75 5.6%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/21/05 BUY 20,985,000 72.75 5.9%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/29/05 BUY 21,361,000 72.66 6.0%
------------------- ---------------------- -------------------- ---------------- --------------------------------
11/30/05 BUY 22,194,000 72.75 6.2%
------------------- ---------------------- -------------------- ---------------- --------------------------------
12/01/05 BUY 22,919,000 72.75 6.4%
------------------- ---------------------- -------------------- ---------------- --------------------------------
12/02/05 BUY 23,930,000 72.75 6.7%
------------------- ---------------------- -------------------- ---------------- --------------------------------
12/12/05 BUY 25,930,000 70.50 7.2%
------------------- ---------------------- -------------------- ---------------- --------------------------------
02/01/06 BUY 29,930,000 60.50 8.2%
------------------- ---------------------- -------------------- ---------------- --------------------------------
02/06/06 BUY 31,180,000 62.50 8.5%
------------------- ---------------------- -------------------- ---------------- --------------------------------
04/05/06 BUY 34,680,000 76.25 9.4%
------------------- ---------------------- -------------------- ---------------- --------------------------------
04/06/06 BUY 50,989,000 75.50 12.3%
------------------- ---------------------- -------------------- ---------------- --------------------------------
* Percentage beneficial ownership of total outstanding Old Common Stock on an
as-converted basis, calculated as described above in Item 5.
Schedule B
(Transactions by QDRF in Convertible Notes
since August 31, 2005)
Date Transaction Aggregate % Face Value Price % Ownership Following
---- ----------- --------- ------------------- ----------------------
Face Value Per Note Transaction*
---------- -------- ------------
-------------------- ---------------------- --------------------- --------------------- -----------------------------
10/28/05 Buy 750,000 79.75 0.2%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
10/28/05 Buy 4,000,000 80.00 1.4%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/02/05 Buy 425,000 70.00 1.5%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/02/05 Buy 599,000 71.50 1.7%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/02/05 Buy 1,275,000 72.00 2.1%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/03/05 Buy 1,658,000 72.50 2.5%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/04/05 Buy 1,700,000 72.75 3.0%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/07/05 Buy 725,000 72.75 3.2%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/09/05 Buy 900,000 72.75 3.5%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/10/05 Buy 625,000 72.75 3.6%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/21/05 Buy 846,000 72.75 3.9%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/29/05 Buy 318,000 72.66 4.0%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
11/30/05 Buy 705,000 72.75 4.1%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
12/01/05 Buy 614,000 72.75 4.3%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
12/02/05 Buy 857,000 72.75 4.6%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
12/12/05 Buy 1,696,000 70.50 5.0%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
02/01/06 Buy 3,390,000 60.50 5.9%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
02/06/06 Buy 1,060,000 62.50 6.2%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
04/05/06 Buy 2,450,000 76.25 6.8%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
04/06/06 Buy 9,785,000 75.50 9.3%
-------------------- ---------------------- --------------------- --------------------- -----------------------------
* Percentage beneficial ownership of total outstanding Old Common Stock on an
as-converted basis, calculated as described above in Item 5.